Truck sales still continue to be strong?

In the last few years, mainstream automakers benefited from strong truck and utility vehicle sales in the US. While small car sales showcased stagnation in the country, demand for heavyweight vehicles rose in the last few quarters. It’s important to note that these heavyweight vehicles, including pickup trucks and utility vehicles, tend to yield higher margins for automakers compared to small cars.

In general, heavyweight vehicles are less fuel efficient than small vehicles. Weakness in oil prices and a recovery in the country’s housing and construction market could be two primary reasons behind the higher sales. Any sustainable recovery in oil prices could hurt US truck and utility vehicle sales going forward. It would result in lower profitability for automakers. It’s important for investors to keep a close eye on oil prices and other factors signaling lowering truck sales in the US.

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